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REPLACEMENT RESERVE AND SECURITY Agreements REPLACEMENT RESERVE AND SECURITY AGREEMENT (this “Agreement “) is made this day of, by (“Borrower “), and, its successors, transferees and assigns
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The replacement reserve is a fund set aside for the purpose of replacing major capital items.
Property owners or managers of properties with a replacement reserve requirement are required to file the replacement reserve.
The replacement reserve is typically filled out with the anticipated costs of replacing major capital items over a specific period of time.
The purpose of the replacement reserve is to ensure that funds are available for the replacement of major capital items when they reach the end of their useful life.
Information such as the anticipated costs of replacing major capital items, the timeframe for replacement, and the current balance of the reserve must be reported.
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